In a recent announcement, the Philippine Securities and Exchange Commission (SEC) urged citizens to refrain from utilizing the derivatives trading services offered by cryptocurrency exchange Gemini. Although the precise reasons for this cautionary advisory have not been confirmed due to an incorrect file link, reports from international media indicate that Gemini’s derivative transactions fall within the realm of securities, necessitating registration with the SEC.
The SEC has been actively regulating the Gemini Foundation platform, which was unveiled by Gemini on the 21st of the previous month. Developed to cater to non-U.S. investors, the Gemini Foundation is a global version of a cryptocurrency derivatives trading platform. While some countries, including Japan, China, and Europe, do not have access to this service, the Philippines is among the countries targeted.
According to Bloomberg, if Gemini were to be prosecuted for violating these regulations, it could face severe penalties, including up to 21 years of imprisonment and a fine amounting to approximately 90,000 USD.
The Gemini Foundation has commenced its operations this month, but in response, the Philippine SEC has strongly advised individuals against investing in the platform and urged existing investors to cease their activities. It is important to note that the specific details regarding domestic regulations surrounding virtual currencies remain uncertain, prompting U.S.-based cryptocurrency exchanges to explore offshore markets. The introduction of the Gemini Foundation aligns with this trend.
According to the official website of the Gemini Foundation, the platform currently offers perpetual futures trading and plans to introduce regular futures and options trading services in the near future. When the announcement was made in April, it was revealed that the platform would initially provide Bitcoin (BTC) physical trading and perpetual futures trading with a maximum leverage of 100 times. Subsequently, Ethereum (ETH) trading options were also expected to be added.
As the situation unfolds, the Philippine SEC’s warning against utilizing Gemini’s derivatives trading services serves as a reminder for investors to exercise caution and adhere to regulatory guidelines. It remains to be seen how Gemini will respond to the SEC’s call for compliance and whether the platform will make the necessary adjustments to continue serving its target audience in the Philippines.
Read more:
- Gemini Announces Launch Of Non-US Crypto Derivatives Platform
- Gemini, Coinbase, And Binance US Experience Major Decrease In Market Depth In March 2023